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1. Total Addressable Market (TAM)
High-level market for your niche.
Your audience is a part of this community.
Money
Annual spendings
$1.5B
People
Annual customer base
300K
Calculations
Step-by-step logic
The total available market (TAM) for a WordPress plugin targeting rentals in the US and Europe can be estimated by considering the size of the rental market. According to industry reports, the rental market in the US alone was valued at approximately $500B in 2022. Assuming that around 0.3% of rental businesses utilize WordPress, this leads to roughly 300,000 businesses. If each spends approximately $5,000 per year on plugins and related services, the TAM sums up to around $1.5 billion annually.
The number of rental properties, including residential, commercial, and vacation rentals, strengthens this calculation. The US has around 48 million rental units, while Europe has over 50 million, making a collective plugin market for rental management substantial. This number includes property managers, landlords, and real estate agencies who might need a solution for managing their listings effectively.
The number of rental properties, including residential, commercial, and vacation rentals, strengthens this calculation. The US has around 48 million rental units, while Europe has over 50 million, making a collective plugin market for rental management substantial. This number includes property managers, landlords, and real estate agencies who might need a solution for managing their listings effectively.
2. Serviceable Addressable Market (SAM)
The portion of your TAM that you can realistically reach.
These people are your potential customers.
Money
Annual spendings
$75M
People
Annual customer base
15K
Calculations
Step-by-step logic
The serviceable addressable market (SAM) is a more focused part of the TAM. Given the competitive landscape and your business size as a solopreneur, it’s realistic to target about 5% of the TAM, which translates to approximately 15,000 potential customers. Each customer would likely spend around $5,000 annually on the plugin, leading to a SAM of about $75 million.
This portion accounts for your geographical limitations, operational capacity, and marketing reach. Targeting small to medium rental businesses in key regions across the US and Europe effectively limits the scope to a manageable number of customers while ensuring significant revenue.
This portion accounts for your geographical limitations, operational capacity, and marketing reach. Targeting small to medium rental businesses in key regions across the US and Europe effectively limits the scope to a manageable number of customers while ensuring significant revenue.
3. Serviceable Obtainable Market (SOM)
The portion of SAM that you can realistically capture.
These people are your customers.
Money
Annual spendings
$750K
People
Annual customer base
150
Calculations
Step-by-step logic
The serviceable obtainable market (SOM) represents what you can realistically capture in your first year. Given your solopreneur status, capturing around 1% of the SAM is a conservative estimate, equating to approximately 150 potential customers. If these customers each spend about $5,000 annually, your SOM would be about $750,000.
This conservative figure aligns with a realistic marketing strategy. It takes into account the time required for gaining traction, establishing brand recognition, and building a customer base. Furthermore, aiming for small rental businesses that require less intensive marketing could increase your chances of conversion.
This conservative figure aligns with a realistic marketing strategy. It takes into account the time required for gaining traction, establishing brand recognition, and building a customer base. Furthermore, aiming for small rental businesses that require less intensive marketing could increase your chances of conversion.
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